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Full text of "North Carolina Register v.2 no. 2 (5/15/1987)"

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RSCEtVEB 
MAY 18 1987 



The 



raw LIBRARY 



NORTH CAROLINA 

REGISTER 



IN THIS ISSUE 



EXECUTIVE ORDERS 

FINAL DECISION LETTERS 

PROPOSED RULES 
Commerce 

Crime Control & Public Safety 
Human Resources 
NR&CD 
State Treasurer 

LIST OF RULES AFFECTED 



ISSUE DATE: MAY 15, 1987 
Volume 2 • Issue 2 • Pages 138-169 



INFORMATION ABOUT THE NORTH CAROLINA REGISTER AND ADMINISTRATIVE CODE 



NORTH CAROLINA REGISTER 

The North Carolina Register is published monihly and 
contains information relating to agency, executive, legislative and 
judicial actions required by or affecting Chapter I SOB of the 
General Statutes. All proposed administrative rules and amend- 
ments filed under Chapter I50B must be published in the Register. 
The Register will typically comprise approximately one hundred 
pages per issue of legal text. 

State law requires that a copy of each issue be provided free 
of charge to each county in the state and to various state officials 
and institutions. The North Carolina Register is available by 
yearly subscription at a cost of ninety-five dollars ($95.00) for 
12 issues. 

Requests for subscription to the North Carolina Register should 
be directed to the Office of Administrative Hearings. P. O. 
Drawer 11666, Raleigh. N. C. 27604. Attn: Subscriptions 



ADOPTION, AMENDMENT, AND REPEAL OF RULES 

An agency intending to adopt, amend, or repeal a rule must 
first publish notice of the proposed action in the North Carolina 
Register. The notice must include a reference to the Statutory 
Authority for the action; the time and place of the public hearing 
and a statement of how public comments may be submitted to 
the agency either at the hearing or otherwise; the text of the 
proposed rule or amendment; and the proposed effective date 

The Director of the Office of Administrative Hearings has 
authority to publish a summary, rather than the full text, of any 
amendment which is considered to be too lengthy In such case, 
the full text of the rule containing the proposed amendment will 
be available for public inspection at the Rules Division of the 
Office of Administrative Hearings and at the office of the 
promulgating agency. 

Following publication of the proposal in the North Carolina 
Register, at least 60 days must elapse before the agency may take 
action on the proposed adoption, amendment or repeal. 

When final action is taken, the promulgating agency must file 
any adopted or amended rule with the Office of Administrative 
Hearings. If it differs substantially from the proposed form 
published as part of the public notice, the adopted version will 
again be published in the North Carolina Register 

A rule, or amended rule, cannot become effective earlier than 
the first day of the second calendar month after the adoption is 
filed. 

Proposed action on rules may be withdrawn by the pro- 
mulgating agency at any time before final action is taken by the 
agency. 



TEMPORARY RULES 

Under certain conditions of an emergency nature, some 
agencies may issue temporary rules. A temporary rule becomes 
effective when adopted and remains in effect for the period 
specified in the rule or 120 days, whichever is less. An agency 
adopting a temporary rule must begin normal rule-making 
procedures on the permanent rule at the same time the temporary 
rule is adopted. 



NORTH CAROLINA ADMINISTRATIVE CODE 

The North Carolina Administrative Code (NCAC) is a 
compilation and index of the administrative rules of 25 state 
agencies and 38 occupational licensing boards. The NCAC 
comprises approximately 15,000 letter size, single spaced pages 
of material of which approximately 359E is changed annually. 
Compilation and publication of the NCAC is mandated by G.S 
l50B-63(b). 

The Code is divided into Titles and Chapters Each state agency 
is assigned a separate title which is further broken down by 
chapters. Title 2 1 is designated for occupational licensing boards. 

The NCAC is available in two formats. 

( 1 ) In looseleaf pages at a minimum cost of two dollars and 
50 cents ($2.50) for 10 pages or less, plus fifteen cents 
($0 15) per each additional page 

(2) On microfiche The microfiche edition is revised semi- 
annually (March and October) and can be purchased for 
forty dollars ($40 00) per edition. Due to the volume 
of the Code, the complete copy can only be purchased on 
microfiche The NCAC on microfiche is updated 
monthly by publication of a '"List of Rules Affected" 
which ^ets out rules filed the previous month, the action 
taken, and the effective date of the change This list is 
published in the North Carolina Register 

Requests for looseleat pages of rules or the NCAC on 
microfiche should be directed to the Office of Administrative 
Hearings. 

NOTE 

The foregoing is a generalized statement of the procedures to 
be followed For specific statutory language, it is suggested that 
Articles 2 and 5 of Chapter I50B of the General Statutes by 
examined carefully. 

CITATION TO THE NORTH CAROLINA REGISTER 

The North Carolina Register is cited by volume, issue, page 
number and date 1:1 NCR 101-201, April 1, 1986 refers to 
Volume I , Issue 1 , pages 101 through 201 of the North Carolina 
Register issued on April 1. 1986. 



North Carolina Register Published monthly by the 
Office of Administrative Hearings. P. O. Drawer 1 1666, 
Raleigh, North Carolina 27604, pursuant to Chapter 150B 
of the General Statutes. Subscriptions ninety-five dollars 
($95.00) per year. 

North Carolina Administrative Code. Published in 
March and October by the Office of Administrative 
Hearings, P. O. Drawer 1 1666, Raleigh, North Carolina 
27604, pursuant to Chapter 150B of the General Statutes. 
Subscriptions forty dollars ($40.00) per edition. 



NORTH 
CAROLINA 
REGISTER 




Office of Administrative Hearings 
P. O. Drawer 11666 
Raleigh, NC 27604 
(919) 733-2678 



ISSUE CONTENTS 



I. EXECUTIVE ORDERS 

Executive Orders 43-46 ... 138 



II. FINAL DECISION LETTERS 

Voting Rights Act .... 141 



III. PROPOSED RULES 

Commerce 

Departmental Rules .... 143 

Savings and Loan .... 147 
Crime Control & Public Safety 

State Highway Patrol . . 159 

Human Resources 

AFDC 156 

Family Services .... 152 

Individual and Family 
Support 153 

Medical Services .... 149 

NR&CD 

Coastal Management ... 160 

Economic Opportunity . . . 161 
State Treasurer 

Departmental Rules ... 161 



Staff: 

Robert A. Mclott, 

Director 
James R. Scarcella, 

Deputy Director 
Molly Mason, 

Assistant Director 
Ruby Creech, 

Publications Coordinator 
Mary Fowler, 

Editorial Assistant 
Teresa Johnson, 

Editorial Assistant 
Jean Shirley, 

Editorial Assistant 
Tammy Poole, 

Records Clerk 



V. LIST OF RULES AFFECTED 

Volume 12, No. 2 163 

(May 1, 1987) 



VI. CU.MULATD E INDEX 



168 



NORTH CAROLINA REGISTER 

Publication Deadlines and Schedules 

(April 1987 ■ March 1988) 



Issue 


Last Day 


I,ast Day 


Larliest 


Larliest 


* 


Date 


for 


for 


Date for 


Date for 


Earliest 




I-iling 


Llcctronic 


Public 


Adoption 


Effective 






Filing 


Hearing 


by Agency 


Date 


++*++♦** 


*+*++♦++ 


♦♦**$+++ 


+*+++♦++ 


+++++*♦♦ 


♦+**♦♦*+ 


04/15/87 


03/26/87 


04/02/87 


05/15/87 


06/14/87 


09/01/87 


05/15/87 


04/27/87 


05/04/87 


06/14/87 


07/14/87 


10/01/87 


06/15/87 


05/26/87 


06/02/87 


07/15/87 


08/14/87 


11/01/87 


07/15/87 


06/25/87 


07/02/87 


08/14/87 


09/13/87 


12/01/87 


08/14/87 


07/27/87 


08/03/87 


09/13/87 


10/13/87 


01/01/88 


09/15/87 


08/26/87 


09/02/87 


10/15/87 


11/14/87 


02/01/88 


10/15/87 


09/25/87 


10/02/87 


11/14/87 


12/14/87 


03/01/88 


11/16/87 


10/27/87 


11/03/87 


12/16/87 


01/15/88 


04/01/88 


12/15/87 


11/23/87 


12/02/87 


01/14/88 


02/13/88 


05/01/88 


01/15/88 


12/28/87 


01/04/88 


02/14/88 


03/15/88 


06/01/88 


02/15/88 


01/26/88 


02/02/88 


03/16/88 


04/15/88 


07/01/88 


03/15/88 


02/24/88 


03/02/88 


04/14/88 


05/14/88 


08/01/88 



* The "Earliest Lffective Date" is computed assuming that the agency files the 
rules with The Administrative Rules Review Commission the same calendar 
month as adoption by the agency and ARRC approves the rules at the next 
calendar month meeting. 



EXECUTIVE 
ORDERS 

EXECUTIVE ORDER NUMBER 43 

NORTH CAROLINA EMERGENCY 
RESPONSE COMMISSION 



The Emergency Planning and 
Community Right-to- Know Act of 
1986 enacted by the United States 
Congress, requires the Governor of 
each state to appoint a State 
Emergency Response Commission. 

NOW, IT IS THEREFORE 
ORDERED, pursuant to the 
authority vested in me by the laws 
and the Constitution of North 
Carolina and the laws of the United 
States: 

S ect ion J- ESTABLISHMENT 
There is hereby established the 
North Carolina Emergency 

Response Commission, hereinafter 
referred to as the "Commission." 
The Commission shall consist of not 
less than eight members and shall be 
composed of at least the following 
persons: 

The Secretary of the 

Department of Crime Control and 

Public Safety or his designee; 

A representative of the 

Environmental Management 

Commission appointed by the 

Secretary of the Department of 

Natural Resources and 

Community Development; 

A representative of the 

Radiation Protection Commission 

appointed by the Secretary of the 

Department of Human Resources; 

A representative of the 

I lealth Services Commission 

appointed by the Secretary of the 

Department of Human Resources; 

The Commissioner of the 

Department of Labor or his 

designee; 

The Secretary of the 

Department of Transportation or 

his designee; 

A representative of the North 

Carolina Association of County 

Commissioners appointed by the 

Governor; ' 



A representative of the North 
Carolina League of Municipalities 
appointed by the Governor; and 
Such other persons as who 
have technical expertise in the 
emergency response field and are 
appointed by the Governor. 

The Secretary of the 
Department of Crime Control and 
Public Safety or his designee shall 
serve as chairman of the 
Commission and all members of the 
Commission shall serve at the 
pleasure of the Governor. 

Section 2. DUTIES 

The Commission is designated as 
the State Emergency Response 
Commission as described in the Act 
and shall perform all duties required 
of it under the Act, including, but 
not limited to the following: 

(A) Appoint local emergency 
planning committees described under 
Section 301(c) of the Act and 
supervise and coordinate the 
activities of such committees. 

(B) Establish procedures for 
reviewing and processing requests 
from the public for information 
under Section 324 of the Act. 

(c) Designate emergency planning 
districts to facilitate preparation and 
implementation of emergency plans 
as required under Section 301(b) of 
the Act. 

(d) After public notice and 
opportunity for comment, designate 
additional facilities that may be 
subject to the Act under Section 302 
of the Act. 

(c) Notify the Administrator of 
the Environmental Protection 
Agency of facilities subject to the 
requirements of Section 302 of the 
Act. 

(0 Review the emergency plans 
submitted by local emergency 
planning committees and make 
recommendations to the committees 
on revisions of the plans that may be 
necessary to ensure coordination of 
such plan with emergency response 
plans of other emergency planning 
districts. 

Section 3- ADMINISTRATION 
(a) The Department of Crime 



NORTH CAROLINA REGISTER 



138 



Control and Public Safety shall 
provide administrative support and 
staff as may be required. 

(b) Members of the Commission 
shall serve without compensation 
but may receive reimbursement, 
contingent on the availability of 
funds, for travel and subsistence 
expenses in accordance with state 
guidelines and procedures. 

Section <L EFFECTIVE DATE 
AND EXPIRATION 

This executive order shall 
become effective immediately and 
will expire in accordance with North 
Carolina law two years from the date 
it is signed. It is subject to 
reissuance at expiration. 

Done in the Capital city of 
Raleigh, this the 7th day of April, 

1987. 



EXECUTIVE ORDER NUMBER 44 

AMENDMENT TO EXECUTIVE 

ORDER 29 

GOVERNOR'S TASK EORCE ON 

RACIAL, RELIGIOUS AND ETHNIC 

VIOLENCE AND INTIMIDATION 

The Governor's Task Force on 
Racial, Religious and Ithnic 
Violence and Intimidation was 
established under Executive Order 
Number 29 on the 2nd day of 
March, 1986 and provided that it 
was to consist of eleven (11) 
members. It has been made to 
appear to me that the Task Force 
should consist of not less than 
twelve (12) members and should 
include at least one American 
Indian. 

Therefore, by the authority vested 
in me as Governor by the 
Constitution and laws of North 
Carolina, IT IS ORDERED: 

Section 2 of Executive Order 29 is 

hereby amended to read as follows: 

Section 2. The Task Force shall 
consist of not less than twelve 
persons to be appointed by the 
Governor for a term to begin 
upon appointment and expiring 
on December 31, 1988. The 
membership of the Task Force 
shall include at least one American 
Indian The Chairman of the 



Task Force shall be appointed by 
the Governor and the 

Vice- Chairman and Secretary of 
the Task Force shall be elected by 
the members of the Task Force. 

All other sections and provisions 
of Executive Order 29 not 
inconsistent herewith shall remain in 
full force and effect. 

Done in Raleigh, North Carolina 
this 22nd day of April, 1987. 

EXECUTIVE ORDER NUMBER 45 

THE GOVERNOR'S LANGUAGE 
INSTITUTES ADVISORY BOARD 

As Governor of North Carolina it 
has been made to appear to me 
upon satisfactory information 
furnished to me as follows: 

1 . Educational programs for 
teachers of foreign languages will 
improve the quality of education 
for students in North Carolina. 

2. Improvement of foreign 
language teaching methods in the 
secondary schools of North 
Carolina will improve proficiency 
in foreign languages and enhance 
opportunities for foreign trade in 
North Carolina. 

NOW, therefore, it is hereby 
ordered, pursuant to the authority 
vested in me by the laws and 
Constitution of North Carolina: 
Section L ESTABLISHMENT 

The Governor's Language 
Institutes Advisory Board, 

hereinafter referred to as the "Board" 
is hereby established. The Board 
shall be composed of not more than 
twelve (12) members appointed by 
the Governor to serve at the pleasure 
of the Governor. The Governor 
shall designate one of the members 
to serve as Chairman. The State 
Superintendent of Public Instruction 
shall be an ex-officio member of the 
Board in addition to those persons 
appointed by the Governor. 
Section 2. FUNCTIONS 
The Board shall have the 
following duties: 

(A) Oversee planning and 
operation of the Governor's 
language Institutes which shall 
be located in various locations 
across the State to provide 



139 



SORT 1 1 CAROLINA REGISTER 



educational programs for North 
Carolina teachers of foreign 
languages. 

(B) Select an external 
consultant to assist in the 
planning of the Governor's 
Language Institutes' programs 
and to recommend curriculum, 
instructors, location of 
Institutes, and sources of 
support, and 

(C) Select a full-time 
Executive Director to manage 
the Institutes. 

Smtion 3 ADMINISTRATION 

(A) The State Department of 
Public Instruction shall provide 
administrative support and staff 
as may be required, 

(B) Members of the 
Commission shall receive 
reimbursement from the State 
Department of Public 
Instruction, contingent on the 
availability of funds, for travel 
and subsistence expenses in 
accordance with state guidelines 
and procedures. 

Section 4. EFFECTIVE DATE 
AND EXPIRATION DATE 
This Executive order shall be 
effective immediately, and in 
accordance with North Carolina 
laws shall expire two years from date 
it is signed. It is subject to 
reissuance at expiration. 

Done in the Capital City of 
Raleigh, North Carolina, this 22nd 
day of April, 1987. 



EXECUTIVE ORDER NUMBER 46 

AMENDMENT TO EXECUTIVE ORDER 

NLMUER 40 GOVERNOR'S 

COMMISSION 

I OR THE FAMILY 

The Governor's Commission For 
the Family was established by 
Executive Order Number 40 on 
March 16, 1987, as a means of 
strengthening our nation's families. 



It has been made to appear that 
the important work of this 
commission can be furthered 
through the appointment of 
additional members by the 
Governor. 

Therefore, by the authority vested 
in me as Governor by the 
Constitution and laws of North 
Carolina, IT IS ORDERED: 

Section 1 of Executive Order 40 
is hereby amended to read as 
follows: 

Sivtinn J- ESTABLISHMENT 

The Governor's Commission For 
the Family is hereby established. 
The Commission shall be composed 
of not less than thirty members 
appointed by the Governor to serve 
at the pleasure of the Governor. 
The Governor shall designate one of 
the members as Chairman and one 
as Vice-Chairman. The Secretaries 
of the Departments of Human 
Resources, Natural Resources and 
Community Development, 

Administration, Crime Control and 
Public Safety, and Cultural 
Resources shall be ex-officio 
members. The members appointed 
by the Governor shall be 
representatives from the following 
areas: 

(1) Private business and 
community leaders; 

(2) Law Enforcement; 

(3) At least one representative 
of the North Carolina Fund for 
Children and Families 
Commission; 

(4) Judicial System; and 

(5) Volunteers who have 
exhibited an interest in family 
issues. 

All other sections and provisions 
of Executive Order Number 40 shall 
remain in effect. 

Done in Raleigh, North Carolina, 
this 22nd day of April, 1987. 



NORTH CAROLI.XA REGISTER 



140 



VOTING RIGHTS ACT FINAL DECISION LETTER 



[G.S. I20-30.9H, effective July 16, 1986, requires that all letters and other 
documents issued by the Attorney General of the United Stales in which a final 
decision is made concerning a "change affecting voting" under Section 5 of the 
Voting Rights Act of 1965 be published in the Knrih Cam/inn R pointer ] 



U.S. Department of Justice 
Washington, D.C. 20530 



WBR:MAP:TGL:dvs 
DJ 166-012-3 
R7408-7414 
R9454 



April 14, 1987 



Richard J. Rose, Esq. 

Poyner & Spruill 

P. O. Box 353 

Rocky Mount, North Carolina 27802-0353 

Dear Mr. Rose: 

This refers to the seven annexations (Ordinance Nos. 0-86-67, 0-86-73, 
0-86-82, 0-86-S6, 0-86-91, 0-86-92, and 0-87-4) and the designation of the wards 
to which the annexed areas are assigned for the City of Rocky Mount in 
Edgecombe and Ncal Counties, North Carolina, submitted to the Attorney 
General pursuant to Section 5 of the Voting Rights Act of 1965, as amended, 42 
CSC. 1973c. We received your submission on February 13, 1987. 

The Attorney General docs not interpose any objections to the changes in 
question. However, we feel a responsibility to point out that Section 5 of the 
Voting Rights Act expressly provides that the failure of the Attorney General to 
object docs not bar any subsequent judicial action to enjoin the enforcement of 
such changes. See Section 51.41 of the Procedures for the Administration of 
Section 5 [52 Fed. Reg. 496 (1987)]. 

Future submissions under Section 5 should be addressed to the Chief, 
Voting Section, Civil Rights Division, Department of Justice, Washington, D.C. 
20530. The envelope and first page should be marked: Submission under 
Section 5 of the Voting Rights Act. Sec also Section 51.24 |52 Fed. Reg. 493 
(1987)|. 

Sincerely, 

Wm. Bradford Reynolds 
Assistant Attorney General 
Civil Rights Division 

By: 

Gerald W. Jones 

Chief, Voting Section 



141 NORTH CAROLINA REGISTER 



U.S. Department of Justice 
Washington, D.C. 20530 



WBR:LLT:AJD:gmh:jmc 

DJ 166-012-3 

N4082 

N7093-7094 

N7097 

R9027-9046 



April 27, 1987 



Michael Crowell, Esq. 
Thanington, Smith & I largrove 
P.O. Box 1151 
Raleigh, North Carolina 27602 

Dear Mr. Crowell: 

This refers to Chapter 972, H. B. No. 33 (1967), as amended by Chapter 
1301, S.B. No. 576 (1969), which changes the method of selecting the five 
county school board members from a partisan, at-large elective-appointive 
system with a majority-vote requirement for nomination to a nonpartisan, 
at-large, direct elective system, increases the length of terms from two to four 
years, provides for staggered terms (3-2), changes the date on which the term of 
office begins, and provides an implementation schedule for staggering terms, 
including interim terms of less than four years; Chapter 216, H.B. No. 486 
(1971), which provides for partisan elections; Chapter 499, H.B. No. 780 (1967), 
which permits deanncxation from the county school district and the seventeen 
dcannexations adopted in 1964, 1968, 1969, 1970, 1975, 1977, 1978, 1980, and 
1982; Chapter 1189, H.B. No. 2141 (1974), which effects an annexation of an 
area located south of the Neuse River to the county school district; Chapter 855, 
H.B. No. 1176 (1975), which deannexes the Kinston City School District from 
the county school district; and Chapter 1179, S.B. No. 811 (1982), which fixes 
the boundaries of the county school district as they existed on June 16, 1982, for 
the county board of education in Lenoir County, North Carolina, submitted to 
the Attorney General pursuant to Section 5 of the Voting Rights Act of 1965, as 
amended, 42 U.S.C. 1973c. We received the information to complete your 
submission on February 24, 1987. 

The Attorney General does not interpose any objection to the changes in 
question. However, we feel a responsibility to point out that Section 5 of the 
Voting Rights Act expressly provides that the failure of the Attorney General to 
object docs not bar any subsequent judicial action to enjoin the enforcement of 
such changes. Sec Section 51.41 of the procedures for the Administration of 
Section 5 [52 Fed. Reg. 496 (1987).] 

Sincerely, 

Wm. Bradford Reynolds 
Assistant Attorney General 
Civil Rights Division 

By: 

Gerald W. Jones 
Chief, Voting Section 



NORTH CAROLINA REGISTER 142 



PROPOSED RULES 



TITLE 4 DEPARTMENT OF 
COMMERCE 

Notice is hereby given in accordance 
with G.S. I50B-I2 that the 
Department of Commerce intends to 
adopt regulations cited as 4 SCAC 
IG .0I01-.01Q3; .0201 -.0203; and 
.030 1 -.0302. 

The proposed effective dale of this 
action is October 1 . 19S7. 

The public hearing will be conducted 
at 2:00 p.m. on June 15. 1987 at 
Commerce Hearing Room 6168, 
Dobbs Building, 430 N. Salisbury St., 
Raleigh, N.C. 27611. 

Comment Procedures: Attendance 
at Public Hearing or written 
statements may be addressed to Mr. 
William A. Dunn, Deputy Secretary 
at the above mentioned address. 

CHAPTER I - DEPARTMENTAL RULES 

SUBCHAPTER IG - LOW-INCOME 
HOUSING TAX CREDIT PROGRAM 

SECTION .0100 - GENERAL 
DESCRIPTION 

.0101 BACKGROUND 

The Rules of this Subchapter apply 
to the administration of the 
low-income housing tax credit 
program. Program administration 
involves the allocation and issuance 
of tax credits to the owners of rental 
housing who meet the low-income 
targeting and other applicable 
requirements of Section 42 of the 
Internal Revenue Code of 1986. 
The low-income targeting 

requirements must be met for a 
certain percentage of the units in a 
housing project throughout a 15 year 
compliance. 

Statutory Authority G.S. 14311-429; 
I43B-430. 



provide access to a wide variety of 
credit uses and to achieve a statewide 
distribution of program benefits. 

Statutory Authority G.S. J43B-429; 
143B-430. 

.0103 DEFINITIONS 

(a) Act - The lax Reform Act of 
19S6, as amended. 

(b) Agency - The North Carolina 
Housing finance Agency. 

(c) Code - The Internal Revenue 
Code of 1986, as amended, and 
including applicable treasury 
regulations proposed or promulgated 
thereunder. 

(d) Committee - The North 
Carolina Tax Reform Allocation 
Committee created by Executive 
Order Number 3. 

(e) Compliance Period - The 
Period defined in the Code, Section 
42(i)(l) and equal to 15 taxable 
years beginning with the first taxable 
year of the credit period with respect 
thereto. 

(f) Credit Period - The Period 
defined in the Code, Section 42(f)(1) 
and equal to the no taxable years 
beginning with the taxable year in 
which the building is placed in 
service, or at the election of the tax 
payer, the succeeding taxable year. 

(g) Project - A qualified low- 
income project. 

(h) Qualified Non- Profit 
Organization - A non-profit 
organization with the meaning of 
that term as defined in the Code, 
Section 42(h)(5)(C). 

(i) Qualified Ixiw-Income Project 
- A housing development which is a 
qualified low-income project with 
the meaning of that term as defined 
in the Code, Section 42(g). 

(j) State Credit Ceiling - The 
tax credit amount allocated to each 
state as that term is defined in the 
Code, Section 42(h)(3)(C). 



.0102 OBJECTIVES 

The purpose of the Rules of this 
Subchapter is to establish a 
procedure for the allocation of the 
available low-income housing tax 
credits. The objective of the 

allocation procedure is to maximize 
the use of the credits available. 



Statutory Authority G.S. 143B-429; 
143B-430. 

SECTION .0200 - REQUIREMENTS 

.02"l ELIGIBLE PROJECTS 

The low-income housing tax 
credit is available for the acquisition, 
construction and rehabilitation of 



143 



XORTH CAROLINA REGISTER 



PROPOSED RULES 



low-income rental housing. All 
projects must comply with the 
requirements of local housing and 
zoning laws and applicable state or 
federal laws, including Section 42 of 
the Internal Revenue Code. 

Statutory Authority G.S. 143B-429; 
I43B-430. 

.0202 APPLICATION PROCEDURE 

(a) The agency will solicit 
applications for tax credits. Such 
action may include advertising in 
newspapers and other media, mailing 
information to prospective 
applicants and other methods of 
public announcement. 

(b) Any sponsor may apply for an 
allocation of tax credits by 
submitting an application to the 
agency in the manner prescribed by 
the committee. 

(c) The low-income housing tax 
credit is available for allocation on 
an annual basis. The committee 
may approve a sponsor's application 
for tax credits for a calendar year 
subsequent to the year of 
application, thereby reserving the 
credits from the subsequent year's 
credit ceiling. 

(d) The Federal Tax Act requires 
that only ten percent of the state's 
tax credits be set aside for qualified 
non-profit organizations. The 
committee has stated that 20 percent 
of the state credit allocation will be 
set aside for such non-profit 
organizations, with the 
understanding. If, on November 1, 
of each year, it is apparent that the 
additional ten percent of the credits 
is not to be utilized; and thusly 
would expire, the committee will 
consider a reallocation of those 
credits to other applicants. 

Statutory Authority G.S. I43B-429; 
143B-430. 

.0203 FEES 

(a) An application for a 
reservation of tax credits must be 
accompanied by a non-refundable 
administrative fee in an amount 
determined from time to time by the 
committee. 

(b) All fees will be used to 
reimburse the agency for cost 
incurred in processing applications 



and in the monitoring of continuing 
compliance by the beneficiary as 
required by the federal code. 

(c) The initial fee schedule will 
be as follows: 

( 1 ) The agency will collect a fee 
of two percent of the first years 
credit. For profit sponsors will 
submit four percent of the first 
year credit with the application. 
If the application goes forward 
and actually uses the credit, two 
percent (1/2 of the application 
fee) will be returned to the 
developer. 

(2) If the developer withdraws or 
fails to meet the deadline to use 
the tax credits, the four percent 
application fee will be forfeited 
to the agency. 

(3) Non-profit organizations will 
submit two hundred dollars 
($200.00) with the application 
and the remainder of the two 
percent will be paid to the 
agency at delivery of the tax 
credits. 

Statutory Authority G.S. I43B-429; 
143B-430. 

SECTION .0300 - SELECTION PROCESS 
.0301 REVIEW OF APPLICATIONS 

(a) Applications will be accepted 
and reviewed by the agency in the 
order that they are received. 
Incomplete applications and those 
not accompanied by the required 
fees, if any, will not be accepted by 
the agency. 

(b) Agency review of an 
application will include, but not be 
limited to, the following criteria: 

(1) The ability of the proposed 
project to meet the 
requirements of Section 42 and 
other applicable sections of the 
Internal Revenue Code and 
regulations promulgated 
thereunder throughout the 
compliance period. 

(2) The financial feasibility of 
the project. 

(3) The ability, experience, 
financial condition and credit 
worthiness of the sponsor. 

(4) The ability of the sponsor to 
successfully complete the 
project and place if in service 
before the close of the calendar 



\ORTH CAROLS A REGISTER 



144 



PROPOSED RULES 



year for which the tax credits 
have been requested. 
(5) The project's compliance with 
local housing and zoning laws 
and other state or federal laws. 

Statutory Authority G.S. I43B-429; 
I43B-430. 

.0302 APPROVAL OR REJECTION OF 
APPLICATION 

(a) Upon completion of it's review 
of the application for tax credits the 
agency staff will recommend to the 
committee that the application 
approval be granted or denied. 

(b) The agency staff 
recommendation will be presented to 
the committee for it's consideration. 

(c) Where the committee grants 
the approval of the application for 
allocation of the tax credit. The 
chairman of the committee, or his 
designee, will issue a communication 
which sets out the following: 

(1) the amount of the low- 
income housing tax credit 
allocation; 

(2) the year date of the annual 
resource from which the 
allocation is made; and 

(3) the date on which the 
allocation of tax credit would 
expire, unless, within ten 
business days after such date, 
the beneficiary of the credit, or 
his counsel, has completed, 
executed and returned to the 
committee, a form which states: 

(A) the date the transaction 
was completed; 

(B) the amount of the tax 
credit used in the transaction; 

(C) the amount of unused 
allocation being returned to 
the statewide pool of low- 
income housing tax credits. 

(d) When the committee is unable 
to approve or decides to deny the 
application, the chairman of the 
committee, or his designee, will so 
indicate in writing, and with 
specificity, will state the reasons for 
such denial. 

Statutory Authority G.S. 143B-429; 
I43B-430. 



Notice is hereby given in accordance 
with G.S. '/50B-/2 that the 



Department of Commerce intends to 
adopt regulation cited as 4 NCAC 
III .0I00-.0/03; .020J-.0204; and 
.030/-.0303. 

The proposed effective date of this 
action is October 1 , 1987. 

The public hearing will be conducted 
at 3:00 p.m. on June 15, 1987 at 
Commerce Hearing Room, No. 6168 
Dobbs Building, 430 North Salisbury 
St., Raleigh, N. C. 27611. 

Comment Procedures: Attendance at 
Public Hearing or written statements 
may be addressed to Mr. William A. 
Dunn, Deputy Secretary at the above 
mentioned address. 

SUBCHAPTER 111 - PRIVATE ACTIVITY 

BOND VOLUME CAPACITY 

PROGRAM 

SECTION .0100 GENERAL 
DESCRIPTION 

.0101 BACKGROUND 

The rules of this Subchapter 
apply to the administration of the 
Private Activity Bond Volume 
Capacity Program. Made necessary 
by Federal legislation, this program 
will relate to a type of financing now 
defined and controlled as "private 
activity" bonds. Executive Order 
No. 37, issued by Governor James 
G, Martin on March 17, 1987 is a 
response to federal mandates. It is 
hereby referenced and incorporated 
herein as if fully set out in this 
Paragraph. 

Statutory Authority G.S. 143B-429; 
143B-430. 

.0102 OBJECTIVES 

The purpose of this Rule in this 
Subchapter is to set out the 
definitions, the procedures and the 
criteria by and under which the 
North Carolina Federal Tax Reform 
Allocation Committee will carry out 
the duties set out in Executive Order 
No. 37. 

Statutory Authority G.S. 143B-429; 
I43B-430. 

.0103 DEFINITION 
(a) Act - shall mean the Tax 
Reform Act of 1986, as amended. 



145 



NORTH CAROLINA REGISTER 



PROPOSED RULES 



(b) Committee - shall mean the 
North Carolina Federal Tax Reform 
Allocation Committee created by 
Executive Order No. 37. 

(c) Department - shall mean the 
North Carolina Department of 
Commerce. 

(d) Issuer - shall mean the entity 
authorized to issue Private Activity 
Bonds, except that in the case of 
Private Activity Bonds issued 
pursuant to Article 22 of Chapter 
160A of the General Statutes of 
North Carolina, or issued solely 
pursuant to regulations, rules, 
procedures or rulings of the Internal 
Revenue Service of the United 
States, "Issuer" shall mean the 
municipal corporation which created 
the issuing commission or the 
municipal corporation which 
approved the issuance of the bonds 
pursuant to such regulations, rules, 
procedures or rulings. 

(c) "Private Activity Bond" - 
will mean any instrument of debt 
defined by federal law and regulation 
as a Private Activity Bond, thusly 
requiring an allocation of Private 
Activity Bond Volume capacity. 

(f) "Private Activity Bond 
Volume Capacity" - will constitute a 
statewide resource which is measured 
by a formula contained in the federal 
tax reform act of 1986. The 
resource will constitute a total 
volume limitations of such bonds 
that can be issued by North Carolina 
issuers. 

(g) "Uniform Volume 
Limitations" - shall mean the total 
volume capacity for North Carolina 
allowed by the formulas contained in 
federal legislation pertaining to 
private activity bonds. 

(h) "Election as carryforward 
purpose" - shall mean a designation 
made by the committee under the 
definitions continued in federal 
legislation. Generally it allows an 
allocation made from the present 
year volume capacity to be used in a 
named subsequent year. 



Statutory Authority 
I43B-430. 



G.S. I43B-429; 



SECTION .0200 - APPLICATIONS 
AND PROCEDURE 



.0201 GENERALLY 

This Section provides the 
application procedures which shall 
be followed, including data and 
information shall be followed, 
including data and information 
submissions, before the North 
Carolina Tax Reform Activity 
Committee will make final decision 
relating to allocations of capacity for 
private activity bonds. 

Statutory Authority G.S. I43B-429; 
I43B-430. 

.0202 INFORMATION AND 
APPLICATIONS 

Issuers and interested parties 
may obtain general information 
pertinent to this program at: 

(1) The North Carolina 
Department of Commerce, 
Room 6122 or 2019, Dobbs 
Building, 430 North Salisbury 
Street, Raleigh, NC 27611 (919) 
733-4962 or 733-5297. 

(2) Office of State Treasurer, 
Room 100, Albemarle Building, 
Raleigh, NC 27611, (919) 
733-3952 or 733-3064. 

Applications may be filed at 
either of the above addresses, but for 
the most part, should be directed to 
the chairman of the committee in 
care of the Industrial Finance Group 
in the Department of Commerce, at 
Room 2019, Dobbs Building. 
Applications will include pertinent 
facts as to the project being financed, 
the time table for construction and 
financing of the project, the details 
of sale and market distribution, as 
well as details concerning economic 
benefits to the area impacted by the 
project. 

Applications will be processed 
by the chairman or staff available to 
him, and presented to the 
committee. 

Statutory Authority G.S. 143B-429; 
I43B-430. 

.0203 FORMAL PROCEDURE 
APPROVAL 

When the committee can approve 
the allocation of capacity, the 
chairman, or his designee, will so 
indicate in writing, any terms or 
conditions of the allocation, 
includuig the expiration date of the 



ISORTH CAROLINA REGISTER 



146 



PROPOSED RULES 



allocation. Any unused portion of 
the allocation will revert back to the 
statewide pool of volume resource. 
The use of any allocation is 
predicted on the Issuer of the bonds, 
within ten business days after such 
issue, advising in writing, that the 
allocation has been used, and stating 
the amount of unused allocation. 
All allocations will be issued with a 
stated time of expiration. If the 
Issuer becomes aware that the bond 
closing cannot be effected within the 
time scheduled, he may apply for an 
extension. In the case of a time 
extension, issuer will provide written 
confirmation from all parties to the 
transaction that they have seen and 
agreed to all terms and conditions 
for the financing. 

Statutory Authority G.S. I43B-429; 
143B-430. 

.0204 FORMAL APPLICATION 
PROCEDURES: DENIAL 

When the committee is unable 
to approve the application, the 
chairman or his designee will so 
indicate in writing, with specificity, 
the reasons for such denial. 

Statutory Authority G.S. 143B-429; 
I43B-430. 

SECTION .0300 REVIEW CRITERIA 
.0301 GENERAL 

It is the purpose of this 
Section to specify the standards and 
the criteria the committee will use in 
making their decisions. 

Statutory Authority G.S. I43B-429; 
143B-430. 



informed authorities, with issuers, 
and with legislative lenders. When it 
appears that the demand for the 
resource will be large enough that 
the needs of all issuers can be met, 
the committee will make allocations 
on a first-come, first-serve basis. 
Where demand, or potential 
demand, appears so large that the 
resource might prove to be 
inadequate, the committee would 
consider, but not limit their 
consideration to, the folio wing: 

(1) the overall good of the state 
and the people of North 
Carolina, 

(2) relative economic need and 
benefit to the issuer and the area 
to be impacted by the following, 

(3) whether or not alternative 
structure or mechanisms for the 
project agreements and the 
financing documents might 
resolve or reduce the need for a 
"private activity bond" capacity 
allocation, and 

(4) whether or not the overall 
project feasibility, is dependent 
on the availability of an 
allocation, and 

(5) whether or not the issuer is 

in competition with another out 
of state issuer for the project 
benefits such as jobs and tax 
base, and 

(6) whether or not the 
availability of the allocation is a 
crucial part of keeping an existing 
industrial plant open, whereas 
the alternatives would be for that 
plant to close. 

Statutory Authority G.S. 143B-429; 
143B-430. 



.0302 ESTABLISHMENT OF 

AVAILABILITY CAPACITY 

The committee will determine 
the amount of the uniform bond 
limitations for Private Activity bonds 
available in North Carolina for the 
pertinent years. These formulas arc 
contained in federal legislation. 

Statutory Authority G.S. 143B-320; 
143B-429. 

.0303 CONSIDERATIONS OF 
RESOURCES USAGE 
AND DEMAND 

The committee will consult with 



Notice is hereby given in accordance 
with G.S. I SOB- 1 2 that the Savings 
and Loan Division intends to adopt 
and amend regulations cited as 4 
NCAC 16D .0404; .0901; 
.1001 -.1004; and 1 6F .0001. 

The proposed effective date of this 
action is October 1 , 19S7. 

The public hearing will be conducted 
at 10:00 a.m. on June 15, 1987 at 
Room 4205, Dobbs Building, 430 N. 
Salisbury' St., Raleigh, N.C. 27611. 



147 



NORTH CAROLINA REGISTER 



PROPOSED RULES 



Comment Procedures: Written 

comments may be sent to Savings 
and Loan Division, P. O. Box 25249, 
Raleigh, NC, 2761 1. Requests for an 
opportunity to present oral testimony 
and a summary of the testimony must 
be received at this address no later 
than June 10, 19S7. 

CHAPTER 16 - SAVINGS AM) LOAN 

DIVISION: SAVINGS AND LOAN 

COMMISSION 

SUBCHAPTER 16D -OPERATION OF 
SAVINGS AND LOAN ASSOCIATIONS 

SECTION .0400 - LOANS 

.0404 ALTERNATIVE MORTGAGE 
INSTRUMENTS 

(a) An association may use any 
alternative mortgage instrument 
agreed upon by the association and 
the borrower. The term "alternative 
mortgage instrument" shall include 
any type of mortgage instrument 
other than a conventional mortgage 
instrument with a fixed interest rate 
and fixed payments. This rub does 

not :<pply to. equity lines of ereilit 

loans as defined in G S 45-Xl An 
association Ls deemed La have 
complied with this link if il 
complies with similar requirements 
promulgated ay. the. federal Lnsuret of 
accounts Garagraphs llu and U4 of 
this Rule apply, only. Lu credit 

lr.<nsai-tinns where the hormwlT is a 

natural person and. the intended use 
of the loan proceeds is fur personal, 
family, or household purposes 

Statutory Authority OS. 54B-55; 
5413- 163. 

SECTION .0900 - INVESTMENTS 
.0901 SECURITIES 

An association may invest in any 
security that has been rated at least 
BAA or equivalent by a nationally 
recognized rating service. In no case 
may investments in BAA ,or 
equivalent securities exceed in the 
aggregate 25 percent of net worth. 

Statutory Authority G.S. 54B-55; 
54 B- 193. 

SECTION .1000 - VOl UNTARY 
DISSOLUTION 

.1001 PLAN OF LIQUIDATION 

The administrator may specify 



provisions which shall be included in 
the plan of Liquidation. 

Statutory Authority G.S. 54B-42; 
54B-55. 

.1002 DISPOSITION OF ASSETS 

After approval of the plan of 
liquidation by the administrator, the 
association shall, except in case of 
dissolution under G.S. 55-1 16(a)(2), 
(3) and (4), immediately cause notice 
of the dissolution to be mailed to 
each known creditor of the 
association, and to the Secretary of 
Revenue, and such notice shall be 
published once a week for four 
successive weeks in a newspaper 
published in the county wherein the 
association has its principal office, 
and, if there be no newspaper 
published in such county, then in 
some newspaper of general 
circulation in such county. The 
association shall then proceed to 
collect its assets, convey and dispose 
of such of its properties as arc not to 
be distributed in kind to its members 
or shareholders, pay, satisfy and 
discharge its liabilities and 
obligations and do all other acts 
required to liquidate its business and 
affairs, including the collection of 
unpaid subscriptions necessary to 
equalize the agreed payments by 
subscribers of its shares. After 
paying or adequately providing for 
the payment of all its obligations, 
the association shall distribute the 
remainder of its assets, cither in cash 
or in kind, among its members or 
shareholders according to their 
respective rights and interests. 

Statutory Authority G.S. 54B-42; 
54B-55. 

.1003 RELOCATION AND 

CANCELLATION OF 
DISSOLUTION 

(a) At any time after the filing 
of the plan of liquidation and prior 
to the filing of a certificate of 
dissolution, a voluntary dissolution 
may be revoked by filing of a 
statement of revocation of 
dissolution. The contents of such a 
statement and the proceedings taken 
so as to revoke a dissolution shall 
conform with such adaptations as 



NORTH CAROLINA REGISTER 



148 



PROPOSED RULES 



are appropriate to revocation under 
either G.S. 54B-40 or 54B-41. 
(b) Upon the filing of such 
statement of revocation of 
dissolution, the revocation of the 
voluntary' dissolution proceedings 
shall become effective and the 
association may again carry on 
business. 



Statutory 
54B-55. 



Authority G.S. 54B-42; 



Comment Procedures: Written 

comments must be submitted by June 
15. 1987 to: Director, Division of 
Medical Assistance, 1985 U instead 
Drive, Raleigh, N.C. 27603. Oral 
comments may be presented at the 
hearing. 

CHAPTER 26 - MEDICAL SERVICES 

SUBCHAPTER 26G - PROGRAM 
INTEGRITY 



.1004 WAIVER 

The administrator may waive or 
alter any requirements set forth in 
this Section to promote the best 
interests of the public or the 
association. 

Statutory Authority G.S. 54B-42; 
54B-55. 

SUBCHAPTER 16F- SERVICE 

CORPORATIONS AM) FINANCE 

SUBSIDIARIES 

.0001 PERMITTED ACTIVITIES 

The service corporation of an 
association may engage in those 
activities which arc approved by the 
federal 1 lomc Loan Hani; Hoard 
federal insurer of accounts for service 
corporations owned solely by federal 
savings and loan associations which 
have principal offices in this state, 
and any investment authorized for 
state-chartered savings and loan 
associations and approved in 
advance in writing by the 
administrator. 

Statutory Authority G.S. 5411-194. 

TITLE 10 - DEPARTMENT OF 
HUMAN RESOURCES 

Notice is hereby given in accordance 
with G.S. I50B-I2 that the Division 
of Medical Assistance intends to 
adopt, amend, repeal regulations 
cited as 10 NCAC 26G .0402: .0403: 
.0707 and 26H MOI-,0605. 

The proposed effective dale of this 
action is October J, 1987. 

The public hearing will be conducted 
at 1:30 p.m. on June 15. 1987 at 
North Carolina Division of Medical 
Assistance, 1985 U instead Drive, 
Room 201, Raleigh. N.C. 27603. 



SECTION .0400 - AGENCY 

RECONSIDERATION AND EXECUTIVE 

DECISIONS 

.0402 RECONSIDERATION REVIEW 
1 OR PROGRAM ABUSE 

(c) The Reconsideration Review 
decision will be sent to the provider 
in writing by certified mail within 
five working days following the date 
of review. It will state the schedule 
for implementing the administrative 
measures and/or recoupment plan, if 
applicable, and it will state that if the 
Reconsideration Review decision is 
not acceptable to the provider, he 
may request au Executive Deci s ion 
uf, in case s ©f su s pension of 
termination a hearing , a contested 
case hearing in accordance with the 
provisions lound at H) NCAC IB 
.0200 The provider shall have 15 
working days to request a contestcll 
case hearing. Unless the request is 
received within the time provided, 
the Reconsideration Review decision 
shall become the divisions final 
decision. hn processing the 

contested case request, the Director 

Medical 

as the 

sE-ill be 

final 



2? tfc 

Assistance 



Division oi 
shall serve 



the 



secretary's designee and 
responsible tor making 
agency decision. 

(44 44+t provider will be 
instructed that the request tot ao- 
Executive Decision «f hearing must 
be received within the time set by 
Rule . 4 03(b) of this Subch a pter . U 
bv that date the request to* aw 
tj xcculivc Dec i s i on has not been 
received , the admini s trative measures 
shall be implemented without further 
notificat i on . 

Statutory Authority G.S. 

I OS A- 25(b): 108A-54: I50B-22; 42 
CFR Part 455. 



149 



NORTH CAROLINA REGISTER 



PROPOSED RULES 



.0403 EXECUTIVE DECISION FOR 

PROGRAM AMUSE (REPEALED) 

Statutory Authority (7.5. 

l08A-25(b); 14313-153: 1501)-//; 42 
CFR Part 455. 

SECTION .0700 - ADMINISTRATIVE 
SANCTIONS AND RECOUPMENT 

.0707 TECHNIQUE FOR 

PROJECTING MEDICAID 
OVERPAYMENTS 

(a) llie Medicaid agency will 
seek restitution of overpayments 
made to providers by the Medicaid 
program. 

(b) The agency will use a 
Disproportionate Stratified Random 
Sampling Technique in establishing 
provider overpayments only for 
repeat offenders. 

(c) This technique is an 
extrapolation of a statistical sampling 
of claims used to determine the total 
overpayment for recoupment. 

(d) The provider may challenge 
the validity of the findings in the 
SAMPLE itself in accordance with 
the provisions found at Rule .0402 
and .0403. 

Statutory Authority G.S. 

108A-25(b); I08A-54; I08A-55; 
I08A-63; 42 CFR Part 455. 

Notice is hereby given in accordance 
with G.S. I50B-I2 that the Division 
of Medical Assistance intends to 
repeal regulation cited as 10 NCAC 
26H .0501. 

'/'he proposed effective dale of this 
action is October 1 , 1987. 

The public hearing will be conducted 
at 1:30 p.m. on June 15. 1987 at 
North Carolina Division of Medical 
Assistance. 1985 U instead Drive, 
Room 201, Raleigh, NC 27603. 

Comment Procedures: Written 

comments concerning this repeal must 
be submitted by June 15, 1987 to: 
Director, Division of Medical 
Assistance, 1985 Umstead Drive, 
Raleigh, NC 27603. Oral comments 
may be presented at the hearing. 

SUBCHAPTER 2611 - REIMBURSEMENT 
PLANS 



SECTION .0500 - REIMBURSEMENT 
FOR SERVICES 

.0501 HOME HEALTH SERVICES 
(REPEALED) 

Statutory Authority G.S. 

108A-25(b); S.L. 1985, c. 479, s. 86. 

SECTION .0600 - HOME HEALTH 
PROSPECTIVE REIMBURSEMENT 

.0601 REIMBURSEMENT PRINCIPLES 

All covered services provided by 
certified home health agencies 
participating in the North Carolina 
Medicaid Program are to be 
reimbursed on a prospective 
payment basis as set forth in this 
plan. The intent of this plan is to 
develop reasonable rates that provide 
incentives for the cost effective and 
efficient delivery of home health 



Statutory Authority G.S. 

108A-25(b); 108A-54; I08A-55; S.L. 
1985, c. 479, s. 86; 42 CFR 440.70. 

.0602 REIMBURSEMENT METHODS 

(a) A maximum rate per visit is 
established annually for each of the 
following services: 

(1) Registered or Licensed 
Practical Nursing Visit; 

(2) Physical Therapy Visit; 

(3) Speech Therapy Visit; 

(4) Occupational Therapy Visit; 

(5) Home Health Aide Visit. 

(b) The maximum rates for the 
services identified in Section (a) 
above are computed and applied as 
follows: 

( 1 ) Payment of claims for visits 

is based on the lower of the 
billed customary charges or the 
maximum rate of the particular 
service. Governmental 

providers with nominal charges 
may bill at cost. For this 
purpose, a charge that is less 
than 50 percent of cost is 
considered a nominal charge. 

(2) The maximum rates arc 
derived from a base year 
selected by the state. The base 
year maximum rates arc set at 
90 percent of the median charge 
per visit for each service. 

(3) To compute the annual 
maximum rates, the base year 
median rates per visit arc 



NORTH CAROLINA REGISTER 



150 



PROPOSED RULES 



adjusted as described in Sections 
(4), (5), and (6). 

(4) Base year rates are adjusted 
by an annua] cost index factor. 
The cost index has a labor 
component with a relative 
weight of 75 percent and a 
non-labor component with a 
relative weight of 25 percent. 
The relative weights arc derived 
from the Medicare Home 
Health Agency Input Price 
Index published in the Federal 
Register dated May 30, 1986. 
Labor cost changes arc 
measured by the annual 
percentage change in the 
average hourly earnuigs of 
North Carolina service workers. 
Non-labor cost changes are 
measured by the annual 
percentage change in the GNP 
Implicit Price Deflator. 

(5) The annual cost index equals 
the sum of the products of 
multiplying the forecasted labor 
cost percentage change by 75 
percent and multiplying the 
forecasted non-labor cost 
percentage change by 25 
percent. The base year rates are 
multiplied by the cost index 
factor for each year from the 
base year to the year in which 
the rates apply. 

(6) Other adjustments may be 
necessary for special factors 
relating to home health services 
or to comply with federal or 
state laws, regulations and 
policies. 

(c) Medical supplies and Durable 
Medical Equipment are reimbursed 
at the lower of billed customary 
charges or a maximum amount 
determined for each supply and 
equipment item. The maximum 
amount for each item is determined 
by multiplying the prevailing 
Medicare Part B allowable amount 
by 145 percent to account for the 
allocation of overhead costs and by 
80 percent to encourage maximum 
efficiency. Estimates of reasonable 
cost will be used if a Medicare 
allowable amount cannot be 
obtained lor a particular supply or 
equipment item. The Medicare 
allowable amounts will be those 
amounts available to the Division of 



Medical Assistance as of July 1 of 
each year. 

(d) Parenteral and Enteral Therapy 
and other in-home therapies (e.g., 
chemotherapy, antibiotic therapy) 
covered under the North Carolina 
Medicaid Program arc reimbursed at 
the lower of billed customary 
charges or the comparable Medicare 
Part B allowable amount. 

(e) Extended home care nursing 

is reimbursed at the lower of billed 
customary charges or an established 
hourly rate. The rate is derived 
from the average billed charges per 
hour in the base year and is adjusted 
annually by the percentage change in 
the average hourly earnings of North 
Carolina service workers. 

(f) In addition to prospective rate 
payments, a hardship cost settlement 
payment is made to a home health 
agency if the agency's total Medicaid 
reasonable cost significantly exceeds 
its total Medicaid payments as 
reported in an annual cost report. 
The amount of the hardship 
payment is equal to the excess cost 
minus ten percent of an agency's 
total Medicaid cost. Hardship 
settlement payments will not be 
available for cost reporting periods 
beginning on or after July 1, 1989. 

Statutory Authority G.S. 

108A-25(b); IOSA-54; 108A-55; S.L. 
1985, c. 479, s. 86; 42 CFR 440.70. 

.0603 APPEALS 

Providers may appeal maximum 
rates by presenting written requests 
and supporting data. Rates will not 
be adjusted retroactively. Appeals 
will be processed in accordance with 
division procedures for Provider 
Reimbursement Reviews. 

Statutory Authority G.S. 

l08A-25(b); 108A-S4; I08A-55; S.L. 
1985. c. 479, s. 86; 42 CFR 440.70. 

.0604 COST REPORTING 
AM) AUDITING 

Annual cost reporting and 
auditing are required in accordance 
with the Medicare principles of 
reimbursement and the Medicare 
intermediary's schedules, standards 
and procedures. 



151 



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PROPOSED RULES 



Statutory Authority G. S. 
l08A-25(b); 108 A -54; I08A-55; S.L. 
1985, c. 479, s. 86; 42 CFR 440.70. 

.0605 PAYMENT ASSURANCES 

(a) The state will pay the 
amounts determined under this plan 
for each covered service furnished in 
accordance with the requirements of 
the State Medicaid Plan, provider 
participation agreement, and 
Medicaid policies and procedures. 

(b) Participation in the program 

is limited to providers who accept, as 
payment in full, the amounts paid in 
accordance with this plan. 

(c) In all circumstances 
involving third party payment, 
Medicaid is the payor of last resort. 
Any amounts paid by non-. Medicaid 
sources arc deducted in determining 
Medicaid payment. 1'or patients 
with both Medicare and Medicaid 
coverage, Medicaid payment is 
limited to the amount of coinsurance 
related to the services, supplies and 
equipment covered under the 
Medicare program. 

(d) Payments may be recouped 
from any provider found to be 
billing amounts in excess of its 
customary charges, or costs if 
charges are nominal, as follows: 

(1) Amounts paid in excess of 
customary charges, or costs if 
charges are nominal. 

(2) A penalty amount equal to 
five dollars ($5.00) per paid visit 
or 25 percent of customary 
charges for supplies, equipment 
and other services. 

Statutory Authority G. S. 

108A-25(b); 108A-54; I08A-55; S. 

L. 1985, c. 479, s. 86; 42 CFR 
440.70. 

Notice is hereby given in accordance 
with G.S. 150B-I2 that the Social 
Services Commission intends to 
amend regulations cited as 10 MCA C 
35E .0105; .0106; 42B .1201; .1203; 
42C .2001; .2212; .2302; .2303; 49C 
.0/01; .0301; .0302. 

The proposed effective date of this 
action is September I, 1987 and 
October 1, 1987. 



The public hearing will be conducted 
at 10:00 a.m. on June 24, 1987 at 
Woodoak Building, Second Floor 
Conference Room, 1 100 Navaho 
Drive, Raleigh, North Carolina 
27609. 

Comment Procedures; Any 

interested person may present his/her 
views and comments either in writing 
or orally at the hearing. Any person 
may request information, permission 
to be heard or copies of the proposed 
regulations by writing or calling 
Bonnie Allred, 324 N. Salisbury 
Street, Raleigh, North Carolina 
276/1. 

_ CHAPTER 35 - FAMILY SERVICES 

SUBCHAPTER 35E - SOCIAL SERVICES 
BLOCK GRANT (TITLE XX) 

SECTION .0100 - CONDITIONS OF 
ELIGIBILITY 

.0105 MAXIMUM INCOME LEVELS 
FOR SERVICES 

(b) 80 Percent of Established 
Income. An individual whose gross 
monthly family income is as much 
as 60 percent but less than 80 
percent of the state's established 
income for a family of that size may 
be eligible for any of the following 
services if available in the county in 
which he lives: 

(1) community living services; 

(2) day care services for 
adults; 

(3) delinquency prevention 
services-residential care; 

(4) health support services- 
resource items; 

(5) housing and home 
improvement services; 

(6) in-home services: chore 
services; 

(7) in-home services: 
homemaker services; 

(8) personal and family 
counseling; 

(9) preparation and delivery of 
meals; 

U-U-) problem pregnancy s erv i ces - 

re s idential care ; 
(444 (10) residential treatment 

for the emotionally disturbed. 

Statutory Authority G.S. 

I43B-I53(2a) b. 



.0106 WITHOUT REGARD TO INCOME 



NORTH CAROLLXA REGISTER 



152 



PROPOSED RULES 



STATUS 

(a) Individuals may be determined 
eligible for the following scrviecs on 
the basis of need for the service and 
without regard to their income: 

( 1 ) adoption services; 

(2) foster care services for 
adults; 

(3) foster care services for 
children; 

(4) protective services for 
adults; 

(5) protective services for 
children; 

(6) any service funded under the 
Social Services Block Grant 
(Title XX) that is needed in 
conjunction with protective 
services may be provided 
without regard to income during 
the first 12 months that 
protective services is provided if 
such service is available in the 
county in which the individual 
lives and the agency has 
received a referral report 
pursuant to G.S. 7A-543 or 
G.S. 108A, Article 6. has 
initiated protective services in 
accordance with program 
policies, and has determined 
that such other services are 
needed to support the provision 
of protective services; 

(7) delinquency prevention 
(excluding residential care); 

(8) employment and training 
support services (excluding 
transportation and resource 
items); 

(9) health support services 
(excluding transportation and 
resource items); 

(10) individual and family 
adjustment services (excluding 
camping component); 

(11) problem pregnancy 
(excluding (including residential 
care). 



Statulon' Authority 

I43B-I53(2a) b. 



G.S. 



(HAITI l< 42 - INDIVTDUAI AM) 
FAMILY SUPPORT 

SUBCHAPTER 42H - I.1CKNSING OK 

HOMES I OR l)F\ I I OI'MI.NTAI I Y 
DISAHI hi) ADULTS 

SI CI ION .12(1(1- PKRSONNI I 

.1201 I'l RSONNI I HI Ql IRI Ml NTS 



The qualifications of administrator, 
co-administrator, supcrvisor-in- 

charge, manager, and co-manager are 
as follows: 

(4) nui-t U; &i good character ; 
must provide written 

documentation about 

convictions of criminal offenses 
from thc~ clcrk of court in the 
county in which the conviction 
was made, and about any 
driving" offenses other than 
minor traffic violations from the 
motor vehiclcTofficc; 

Statulon- Authority G.S. 131D-2; 
I43B-I53; 1 68- 1; I6S-9. 

.1203 QUALIFICATIONS OF RELIEF 
PFRSON-IVCHARGE 

(a) Qualifications of relief 
person-in-charge arc set forth in 
Rule .1202 of this Section except 
that the relief person-in-charge must 
provide written documentation 
about convictions of criminal 
offenses from the clerk of court in 
the county in which the conviction 
was made, and about any d rising 
o flenses other than minor traffic 
violations from the motor vehicles 
office; 

Statutory Authority G.S. 131D-2; 
1 4311-/ 53. 

SUBCHAPTER 42C - LICENSING OF 
FAMILY CARE HOMES 

SECTION .2000 - PERSONNEL 

.2001 QUALIFICATIONS OF 
ADMINISTRATOR 

(1) The potential administrator 
must applv on the License 
Application' (DSS-1860). The 
Recommendation for a License 
(DSS-1861) is to be completed 
by the county department of 
social services and forwarded 
along with references and other 
appropriate forms to the Division 
of Facility Services for approval 
or disapproval; 

(2| The administrator (approved 
after January 1, 1 ( >77) must be at 
least a high school graduate or 
certified under the G.L.D. 
Program; 

(3) The administrator must be 18 
\ears of age or older; 

(4) The administrator or 



153 



tXORTH CAROLINA REGISTER 



PROPOSED RULES 



corporation must be able to 
obtain credit or have other 
verified resources to meet 
operating costs and provide 
required services when 

unexpected situations arise, such 
as extended resident vacancies 
and major home repairs. 
Verification of ability to obtain 
credit or the availability of other 
resources must be documented 
by the administrator or 
corporation; 

(5) The administrator must be 
willing to work with bona fide 
inspectors and the monitoring 
and licensing agencies toward 
meeting and maintaining the 
Rules of this Subchapter and 
other legal requirements, 
including those of the Civil 
Rights Act of 1964 when the 
administrator has signed Form 
DSS-1464; 

(6) The administrator, or a person 
designated in writing by the 
administrator to act as his agent 
and make decisions on his behalf, 
must meet with the Adult Homes 
Specialist at the specialist's 
request at an agreed time in the 
home as often as necessary to 
insure compliance with the 
standards; 

(7) The administrator must meet 
the general health requirements 
specified in Rule 2004 of this 
Subchapter; 

(8) The administrator must 
provide at least three current 
reference letters and/or the names 
of individuals with whom a 
reference interview can be 
conducted. The individuals 
providing reference information 
must be knowledgeable of the 
applicant administrator's 
background and qualifications 
and must include at least one 
former employer. Xiv± county 
department of s ocial services i* to 
c h eck police *ud court records . 

(9) The administrator must 
provide written documentation 
about convictions o[ criminal 
offenses from thc~ clcrk of court 
in the county in which the 
conviction was mai3c, ~ arid about 
any dnving~ ~ offcnscs other than 



minor traffic violations from the 
motor vehiclcs~office; 
(■9) (10) The administrator must 
meet the requirements of either 
Subparagraph (a) or (b) of this 
Paragraph in accordance with 
procedures established by the 
Department of Human 

Resources: 

(a) 'I"hc administrator must verify 
that he has worked in a licensed 
domiciliary facility for at least 
30 days in an on-the-job 
training program approved by 
the Department of Human 
Resources; or 

(b) The administrator must verify 
that he has past education, 
training and experience related 
to the management and 
operation of adult residential 
care facilities; 

(44)) (11) The administrator must 
verify that he earns 15 hours a 
year of continuing education 
credits related to the management 
of domiciliary homes and care of 
aged and disabled persons in 
accordance with procedures 
established by the Department of 
Human Resources. The 

requirements for earning 

continuing education credits does 
not apply in those situations 
where the administrator is also a 
currently licensed nursing home 
ad mini st rator; and 



Statutory Authority G.S. 
I43B-/53. 



13ID-2; 



SECTION .2200 - ARRANGEMENT AND 
SIZE OF ROOMS 

.2212 HOUSEKEEPING AND 
FURNISHINGS 

(c) Each bedroom must have the 
following furnishings in good repair 
and clean for each resident: 

(1) Single bed equipped with box 
springs and mattress or solid 
link springs and no-sag 
inncrspring or foam mattress. 
Hospital bed appropriately 
equipped must be arranged for 
as needed. A double bed is 
allowed if used only for single 
occupancy, unless occupied by 
husband and wife. A water bed 
is allowed if requested by a 
resident and permitted by the 



KORTH CAROLIX4 REGISTER 



154 



PROPOSED RULES 



home. Each bed is to have the 
following: 

(A) at least one pillow with 
clean pillow case; 

(B) clean top and bottom 
sheets on the bed, with bed 
changed as often as necessary 
but at least once a week; and 

(C) clean bedspread and other 
clean coverings as needed; 

(2) a bedside type table for each 
bed accessible to the resident 
while in bed; 

(3) chest of drawers or bureau 
when not provided as built-Lns, 
or a double chest of drawers or 
double dresser for two residents; 

(4) a wall or dresser mirror 

that can be used by each 
resident; 

(5) a minimum of one 
comfortable chair (rocker or 
straight, arm or without arms, 
as preferred by resident), high 
enough from door for easy 
rising; 

(6) additional chairs available, 
as needed, for use by visitors; 

(7) individual clean towel and 
wash cloth, and towel bar; and 

(8) a bedside lamp or a light 
overhead of bed with a toggle 
switch within reach of person 
lying on bed; or a lamp. The 
light must be of 30 foot-candle 
power for reading. 

Statutory Authority G.S. I3ID-2; 
143B-I53. 

SECTION .2300 - SERVICES 
.2302 HEALTH CAKE 

(d) If a resident is hospitalized, 

a completed 1 L-2 or patient transfer 
torm must be obtained before the 
resident can be readmitted to the 
lacility 

(e) Between annual medical 
examinations there mav be a need 



retained in the resident's record in 



the home. The physician's orders 



must be included in the health 



lor a physician's care. The I-orm 
DSS- 1 S67 or an equivalent record rs 
to be used by the physician to report 
any drugs prescribed and any 
treatment given or recommended lor 
minor illnesses. 

(I) All contacts I office, home 
or telephone) with the resident's 
physician are \o be recorded on 
1'orm DSS- 1867 or an equivalent 
health services record which is to be 



services record used for the resident, 
as follows: 

( 1 ) when the resident is 
examined in the physician's 
office, the health services record 
is to be taken and the physician 
[s to add all necessary 
information; 

(2) when the physician examines 
the resident in the home, the 
physician is to add all necessary 
inlormation " Into " tne health 
services record; and 

(3) when a physician's order is 
given by telephone, the 
administrator or 
supervisor-in-charge must enter 
this into the health" services 
record, initial it and have the 
physician sign it within 30 days 
from thedate th~e order is given. 

(©) [h_l Tne administrator must 
have specific written instructions 
recorded on Iorm DSS - 1865 as to 
what to do in case of sudden illness, 
accident, or death of a resident. 

Statutory Authority G.S. I3ID-2; 
I '43 B- 1 53. 

.2303 1 OOI) SERVICE 

(a) Preparation and Serving of 
Food: 

(5) When room s ervice is 

necessary for phy s ical and ' or 
emotional rea s ons , it must be. as 
complete as table s ervice with 
special attention to preparation 
and prompt serving m order 
U-u+i correct temperature s of 
food a*e maintained . J-tot food 
must be- seated hot (above 440 
degrees £4 60 degree s t-+ and 
tj-44 food served cold (below 45 
degrees J-, J degree s (— h Hot 
food shall be served hot and 
cold food served cold - and in a 
consistency to meet individual 
If 



needs 



assistance in eating 
be maintained at 
temperature until 
provided. 



residents require 
food shall 



serving 
assistance is 



Uj4 U lood is transported from 
the. kitchen to dining arca(s) 
other than the main dining 
room , it must be transported hi 



155 



KORTH CAROLIXA REGISTER 



PROPOSED RULES 



a s anitary maimer , w i th hot 
foot! sccucd hot (abov e 440 
degree* E, 60 degrees t-> and 
cold food s erved w-44 (below 45 
degrees E, 7 degrees C-4- 
(c) Special Modified Diets: 

(1) All special- modified diet 
orders must be in writing from 
the resident's physician. Special 
Modified diet orders must be 
calorie or gram specific unless 
standing orders, which include 
the definition of any s pecial 
modified diets, have been 
obtained from the physician and 
are on file in the home. 

(2) Menus for these special 
modified diets must be planned 
or and/or reviewed and signed 
(including registration number) 
by a registered dietitian; 

(3) The administrator is 
responsible for maintaining an 
accurate and current listing of 
residents for whom s pecial 
modified diets have been 
prescribed and a the special 
modified diet ordered, for use 
by food service personnel; 

(5) The administrator is 

responsible for assisting 

residents who need s pecial 
modified diets in understanding 
and accepting these diets. 

Statutory Authority G.S. I3ID-2; 
I43B-153. 

CHAPTER 49- Al DC 

SUBCHAPTER 49C - EMERGENCY 
ASSISTANCE 

SECTION .0100 - COVERAGE 

.0101 ELIGIBILITY I OR COVERAGE 

(a) Eligibility for coverage will 
be as follows: 

(1) Emergency Assistance shall be 
provided to or on behalf of a 
needy child(ren) under the age 
of 21, the specified relative of 
the needy child(ren), the spouse 
of the specified relative and a«y- 
olhcr child(ren) under the age of 

jmq |> mM ICH t he C are and 

supervi s ion of the specified 
relative all other individuals 
sharing the same single unit 
dwelling with the exception of 



roomer/boarders and other 
individuals wh"o occupy a 
separate apartment within the 
single unit dwelling. The needy 
child under the age of 21 who is 
within the specified degree of 
relationship must be living with 
the specified relative or have 
lived with the specified relative 
within six months prior to the 
month in which Emergency 
Assistance is requested. 
(2) Families of migrant workers 
shall be covered if the 
requirements stated in 

Paragraph (a) of this Rule and 
the regulations stated in 45 
CFR 233.120 arc met. 
(b) Verification 

(1) The county shall accept the 
applicant's statement to verify 
the household composition. 

(2) The county shall accept the 
applicant's statement verifying 
living with and kinship unless 
questionable. If the applicant's 
statement is questionable, the 
county department of social 
services shall be required to 
verify living with and kinship 
according to Rules in 10 NCAC 
49B .0304. 

Statutory Authority Chapter 1014. 
Section 119, Session Laws 19S5 
(1986 Regular Session); I43B-I53. 

SECTION .0300 - RESERVE AND 
INCOME 

.0301 RESERVE 

(a) A family shall be allowed to 
reserve total resources at a maximum 
of two thousand two hundred dollars 
($2,200). Included in the two 
thousand two hundred dollar 
($2,200) total, a 



hundred 
family 



_ shall be 

allowed to reserve liquid assets at a 
maximum of three hundred dollars 
($300). if the total reserve owned 
by the family exceeds two thousand 
two hundred dollars ($2,200), it shall 
be ineligible. If the liquid assets 
owned by the family exceed three 
hundred dollars~$300), the family 
shall be ineligible regardless of the 
total amount of reserve. liquid 
assets shall include all reserve items 
listed in [c] below except (6), (7) and 
[81 

(b) Resources owned by members 



XORTH CAROLINA REGISTER 



156 



PROPOSED RULES 



of the household applying for 
Emergency Assistance shall be 
counted. 

(c) The following reserve items 
shall be counted: 

( 1) cash on hand; 

(2) the current balance of savings 
account(s); 

(3) that portion of a checking 
account other than the monthly 
income deposited to meet the 
household's needs; 

(4) stocks, bonds, mutual fund 
shares, savings certificates; 

(5) revocable trust funds; 

(6) life estate and remainder 
interest, if salable; 

(7) net proceeds from a business, 
including a farm, which has 
been discontinued; 

(8) equity in real property not 
used as a home or producing an 
income. 

(d) The following reserve items 
shall be excluded: 

( 1) household or personal 
belongings (includes essential 
and non-essential personal 
property); 

(2) motor vehicles; 

(3) primary residence, including 
mobile home, and all 
contiguous property; 

(4) income-producing property; 

(5) insurance (including burial, 
term, and whole life cash 
values); 

(6) value of prepaid burial 
contracts; 

(7) value of burial plots; 

(8) savings of a student under the 
age of 21 who is saving his 
money for school expenses; 

(9) relocation assistance 
payments; 

(10) that portion of monthly 
income deposited in a checking 
account to meet monthly needs; 

(11) non-salable life estate or 
remainder interest; 

( 12) heir property; 

(13) IILD community 
development block grants. 

(e) Verification 

( 1) Unless questionable, the value 
of the family's reserve shall be 
verified by the specified 
relative's statement. 

(2) If the family's resources equal 



or exceed two thousand two 
hundred dollars ($2,200) or the 
specified relative's statement is 
questionable, resources shall be 
verified according to 10 NCAC 
4913 .0307. 
(3) If additional verification is 
required, the application may 
pend beyond 48 hours. 

Statutory Authority Chapter 1014, 
Section 119, Session Laws 1985 
(1986 Regular Session); 143B-I53. 

.0302 1NCOML 

(a) Except for verification, base 
periods, and determination of net 
income, income Rules stated in 10 
NCAC 49B .0308 shall control for 
Emergency Assistance. 

(b) Base Periods 

( 1) lor continuing earned 

income, the county department 
of social services shall use the 
applicant's most recently paid 
wage. TTic county department 
of social services shall convert 
this income to a monthly 
amount. 



(2) 1'or all other income except 
farm income, small business, 

and 
income, the 



property 



rentals 



roomer/boarder _ 

county department of social 
services shall use income 
actually received ~~ d"uring the 
month prior to the month ~oT 
application. 
(3) l-'or income from a farm, 
small business, property rental 
or a roomer/boarder, the base 
period shall be the month prior 
to the month of application 
through the date of application. 
The county department oT 
social services shall divide the 
uross income received durin 



this period by the number o 
months the income covers. 7F 
income Irom a farm, small 
business, property rental or a 
roomen boarder is received other 
than tEe base period herein 
countv 



the nase pe 



:ribed, 



the 



department of social 
shall count the 
remaining as of the 



servic es 
amount 
date of 



application in reserve, 
(c) Determination ot^ Net Income 
( 1 ) Net unearned income is the 



157 



SORT 1 1 CAROLINA REGISTER 



PROPOSED RULES 



amount actually received by 
each applicant. 
(2) Net earned income, other 
than income from a farm, small 
business, property rental, or a 
roomer/boarder, is the amount 



(I 1- ) labor costs; 



remaining 
deductions 



after payroll 

for Social Security 



(1'ICA), " federal and state taxes, 
medical and hospital insurance, 
retirement, union dues, and any 
other deduction required by the 
employer. 
3) Net earned income from a 



% 



arm is the amount remaining 
after deduction of operational 
expenses directly related to 
producing the income. These 
expenses include but are not 
limitedto: 

(A) fertilizer, insecticides, seed, 
crop insurance; 

(B) livestock maintenance; 

(C) rent payments; 

(D) taxes; 

(E) building and equipment 
maintenance; 

(F) interest on debts. 

(4) Net earned income from a 
small business or Trom 
self-employment is the amount 
deduct ion" oT 
directly 



remaining after 
operational 



xpen 



related to producing the income. 
These expenses may include but 
are not limited to: 

(A) taxes required to operate 
the business; 

(B) licenses and permit fees; 

(C) rent payments; 

(D) insurance; 

(E) labor costs; 
(!•') maintenance; 

(G) products required to 

operate the business; 
(H) interest on debts; 
(1) food costsTor self-employed 

babysitters. 
(5) Net earned income from 
property rental is the amount 
remaining alter deduction oF 
operational expenses directly 
related to producing the income. 
These expenses may include but 
arc not limited to: 
(A) interest on debts; 



m 

021 

m 



taxes; 
insurance; 
maintenance; 
utilities; 



(G) real estate agent's fees. 
(6) Net earned income from a 
roomer/boarder is the amount 



remainin 
cost of 



after deduction of the 
ood d irectly related to 



producing the income. 
(±4 (d) Verification 

(1) The county department of 
social services shall use any 
resources available at the county 
department to verify income of 
the family. These resources 
may include but arc not limited 
to other public assistance case 
records of the family, income 
listings such as the State Data 
Exchange, Bcndex, or 
Unemployment Insurance and 
Wage Eiles which is are 
available both on paper listing 
and on-line in the State's 
Eligibility Information System. 

(2) If records are unavailable at 
the county department of social 
services for verifying income, 
county departments of social 
services shall accept the 
specified relative' s written 
statement its to tiw amount of 
ike family's income, unless 
questionable , wage stubs or a 
written statement from the 
employer. If the county 
department of social services is 
unable to obtain wage stubs or 
a written statement from the 

the 



it shall accept 

relatives written 

statement of each household 



employer 
spec ified 



iber's 



income, 



unless 
questionable. 

(3) If no verification is available 
and the specified relative's 
statement is questionable, the 
county department of social 
services shall be required to 
verify income according to the 
Rules in 10 NCAC 49B 
.0308(g). 

(4) If additional verification is 
required, the application may 
pend beyond 48 hours. 

Statutory Authority Chapter 1014, 
Section 119, Session Laws 1985 
(1986 Regular Session); 143B-/53. 

Notice is hereby given in accordance 
with G.S. I50B-12 that the Social 



\ORTH CAROLL\A REGISTER 



158 



PROPOSED RULES 



Services Commission intends to 
amend regulation cited as 10 NCAC 
35E .0315. 

The proposed effective dale of this 
action is October 1 , 1987 . 

The public hearing will be conducted 
at 10:00 a.m. on June 15. I9S? at 4th 
Floor Conference Room, Albemarle 
Building. 325 N. Salisbury Street, 
Raleigh, NC. 

Comment Procedures: Any 

interested person may present his; her 
comments either in writing three days 
prior to or at the hearing or orally at 
the hearing for a maximum of ten 
minutes. Any person may request 
information by writing or calling 
Victoria V'oight, Office of Legislative 
and Lcyal Affairs, 325 N . Salisbury 
Street, Raleigh. NC 919-733-6920. 

SECTION .11300 - SERVICE 
DEFINITIONS 

.0315 PROBLEM PREGNANCY 
SERVICES 

(a) Primary Service. Problem 
pregnancy services are services to 
individuals who arc involved with an 
undcsircd pregnancy. Services 

include counseling to assist such 
individuals in looking at alternative 
solutions to the unwanted pregnancy 
(e.g., abortion, adoption, or keeping 
the baby), and at the probable 
consequences of each alternative; 
and assistance in arranging for and 
utilizing other needed services. 
Residential care, including a 
concentrated regimen of services as 
described in (a) of this Rule, room 
and board for up to six months, 
medical supervision, and medications 
required for health maintenance in 
pregnancy as prescribed by a 
physician may be provided when 
such care is provided in a licensed 
maternity home , an approved living 
arrangement prescribed in J_0 NCAC 
421- .001)6 (21 and .0007 IK 
Psychiatric counseling specifically 
related to help in coping with the 
pregnane) may also be included as 
an integral but subordinate part of 
the re amen of residential services. 



Statutory Authority 

143B-I53(2a) b. 



as. 



TITLE 14A - DEPARTMENT OF 

CRIME CONTROL AND PUBLIC 

SAFETY 

Notice is hereby given in accordance 
with G.S. 150B-12 that the Highway 
Patrol Division intends to adopt and 
amend regulations cited as 14A 
NCAC 9B .0101; 9H .0105; 
.0804-. 0S05; 91 .0003. 

The proposed effective dale of this 
action is October 1, 1987. 

The public hearing will be conducted 
at 10:00 a.m. on June 22, 1987 at 
The Library, Second Floor, Archdale 
Building, 512 N. Salisbury Street, 
Raleigh, North Carolina. 

Comment Procedures: Any 

interested person may present 
comments relevant to the action 
proposed at the public hearing either 
in written or oral form. Written 
statements not presented at the public 
hearing must be directed prior to 
June 22, 1987 to the Administrative 
Procedures Coordinator, Second 
Floor. Archdale Building. 512 N. 
Salisbury Street, Raleigh or P.O. Box 
27687, Raleigh, NC 27611-7687. 

CHAPTER 9 - STATK HIGHWAY 
PATROL 

SUBCHAPTER 9B - PERSONNEL 
REGULATIONS 

SECTION .0100 - EMPLOYMENT 
REGULATIONS 

.0101 HIGHWAY PATROL MANUAL 
ADOPTION BY REFERENCE 

(a) The State Highway Patrol 
Division of the Department of 
Crime Control and Public Safety 
adopts by reference the portions of 
the Highway Patrol Manual, 
Personnel Regulations 9B 
.01 00-. 0400, effective February i, 
m&, October 1, 1987. 

(b) Copies of the Manual may be 
inspected in the Administrative 
Procedures Section of the Attorney 
General' s Office , 4-U U. Jone s Street , 
Office of Administrative Hearings, 
Raleigh, North Carolina or the 
Highway Patrol Headquarters, First 
Floor, Archdale Building, 512 N. 
Salisbury Street, Raleigh, North 
Carolina. 



159 



NORTH CAROLINA REGISTER 



PROPOSED RULES 



Statutory Authority G.S. 20-184; 
20-/85; 20-/87; 20-/88; 1 26-16; 
I43B-I0; 150B-II; 150/1-14. 

SURCIIAI'TKK 911 - ENFORCEMENT 
REGULATIONS 

SECTION .0100- ENFORCEMENT 
ACTIONS 

.0105 VALIDATING CITATIONS 

Members shall deliver the 
N.C.U.C. to a judicial official of the 
General Court of Justice, for 
validation as soon after issuance as 
practical. In no case shall a member 
fail to deliver the N.C.U.C. within 
five calendar days of issuance, or 
prior to the designated court date, 
whichever should come first. 

Statutory Authority G.S. 1 5 A- 302; 
20-184; 20-/85; 20-/87; 20-/88. 

SECTION .0800 - PERSONS IN 
CUSTODY 

.0804 TRANSPORTING FEMALES 

(a) A male member shall not 
transport a female prisoner without a 
third person being present 
throughout the trip. Hxceptions 
may be made whenever it is 
impossible or impractical to have a 
third person present. 

(b) Whenever it is necessary for 

a male member to transport a female 
prisoner without the presence of a 
third person, he shall: 

(1) Notify the tclecommunicator 
on duty of the time of departure 
or arrest, the odometer reading, 
pace of intended incarceration 
destination and \im estimated 
time of arrival at that location. 

(2) Upon arrival at the 
destination the member shall 
notify the tclecommunicator of 
the time and the odometer 
reading. 

(c) Hxceptions may be made to 
the Rules sctTorth in Tliis Section in 
individual cases when authorized by 
a First Sergeant or higher authority. 



Statutory Authority G.S. 
20-/85; 20-/87; 20-/88. 



20-/84; 



of prisoners at the time of arrest or 
detention. 

(b) When a member stores or 
takes possession of a - vehicle 
containing a domesticated animal or 
arrests an individual that has in his 
possession a domesticated anuiiaT 
the member shall make reasonable 
efforts to ensure for the safety and 
well-being of the animal. 
Reasonable efforts may include 
contacting the animal's owne r, an 
immediate lamily member of - the 
owner, an Animal Shelter, or an 
Animal Control Officer. 

Statutory Authority G.S. 20-/84; 
20-/85; 20-/87; 20-188. 

SUBCHAPTER 91 - EFFECT AND USE OF 
MANUAL: LIABILITY 

.0003 NO CONTRACT RIGHTS 

This Manual, Chapter 9 of Title 
14A of the N. C. Administrative 
Code, and all policies, rules, 
regulations, directives, and 

procedures of the Patrol and the 
Department of Crime Control and 
Public Safety shall not be construed 
to grant or guarantee to a member 
or an applicant any right or privilege 
or to establish a contract or 
mandatory procedure. Compliance 
with the State Personnel Act or 
other applicable law or procedure 
shall be deemed to be compliance 
with this Manual, policies, rules, 
regulations, directives, and 

procedures of the Patrol and the 
Department of Crime Control and 
Public Safety. 



Statutory Authority G.S. 
20-/85; 20-/87; 20-/88. 



20-/84; 



.0805 PROPERTY OF PRISONERS 

(a) Members shall take all 
reasonable measures to protect the 
personal property in the possession 



TITLE 15 - DEPARTMENT OF 

NATURAL RESOURCES AND 

COMMUNITY DEVELOPMENT 

Notice is hereby given in accordance 
with G.S. /SOB- 12 that the Division 
of Coastal Management intends to 
amend regulations cited as 15 NCA C 
71/ .0308. 

The proposed effective date of this 
action is October I, 1987. 

The public hearing will be conducted 
at 10:00 a.m. on June 18, 1987 at 



NORTH CAROLINA REGISTER 



160 



PROPOSED RULES 



Marine Fisheries Building, 3411 
Arendcll Street, Morehcad City, NC 

Comment Procedures: Written 

comments may be submitted within 
30 days prior to hearing to: Portia 
P.ochelle, Division of Coastal 
Management, P.O. Box 27687, 
Raleigh, NC 27611. 

CHAPTER 7 - COASTAL MANAGEMENT 

SUBCHAPTER 711 - STATE GUIDELINES 
FOR ARIAS OF ENVIRONMENTAL 

CONCERN 

SECTION .0300 - OCEAN IIA/.ARD 
AREAS 

.0308 SPECIFIC USE STANDARDS 

(3) Sand- 1 rapping Devices: Low 
intensity off-shore passive 
sand-trapping devices T such a* 
artificial seaweed, may be 
permitted provided: 

Statutory Authority G.S. II3A-107; 

l/3A-//3(b)(6J. 

Notice is hereby given in accordance 
with G.S. I50B-12 that the Division 
of Economic Opportunity intends to 
amend regulations cited as 15 NCAC 
16C .0105 and .0/08. 

The proposed effective date of this 
action is October 1, 1987. 

The public hearing will be conducted 
at 10:00 a.m. on June 15, 1987, at 
Fifth Floor Conference Room, 5/2 N. 
Salisbury St., Raleigh, N. C. 276/1. 

Comment Procedures: All interested 
persons are invited to attend. 
Comments may be submitted in 
writing or may be presented orally at 
the hearing. Oral presentations 

which exceed three minutes are 
requested to have a written copy to 
be filed with the hearing clerk. 
Further details of the proposed 
changes may be obtained by writing 
or calling: Mr. James L. Forte, 
Director, Division of Economic 
Opportunity, Post Office Box 27687, 
Raleigh, N. C. 27611: (919) 
733-2033. 

CHAPTER 16- DIVISION OF 
ECONOMIC OPPORTUNITY 



SUBCHAPTER 16C - COMMUNITY 
SERVICES BLOCK GRANT PROGRAM 

SECTION .0100 - GENERAL 
PROVISIONS 

.0105 ELIGIBLE ACTIVITIES 

(6) to assist unemployed and 
disadvantaged individuals 

through Community Food arid* 
Nutrition initiatives: 



(a) to coordinate existing 
private and public food 
assistance resources, whenever 
such coordination is determined" 
to be inadequate, to better serve 
low-income populations; 

(b) to assist low-income 
communities to identify 
potentiaf sponsors of child 
nutrition programs and to 
initiate new programs In 
underscrved or unserved areas; 



and 
(c) to develop innovative 

approaches at tHe state and 
local level to meet the nutrition 
needs o\_ low-income people. 

Statutory Authority G.S. 

143-323(d); 143B-276; 143B-277; 42 
U.S.C. 9901-12. 

.0108 ALLOCATION OE CSBG FUNDS 

(e) supplemental CSBG grants. 
1 he preceding Paragraphs of this 
Rule do not apply to the allocation 
of supplemental CSBG grants to 
North Carolina. Such allocations to 
Tor eligible" 
by the 



eligible applicants 
activities will be macle 



divis ioi .!■ 'i nn.iiiiM^viii 

with 
conditions 



federal guidelines 



on 



and 
supplemental 
appropriations. The division has the 
flexibility to determine the number 
of grants awarded and the manner in 
which grantce(s) are selected based 
upon the amount of the allocation 
and th"e~ intent of"~tf"e~ applicable 
legislation and regulations. 

Statutory Authority G.S. 143B-276; 
143B-227; l43-323(d); 42 U.S.C. 
9901-/2. 

TITLE 20 DEPARTMENT OF 
STATE TREASURER 

Notice is hereby given in accordance 
with G.S. I50B-I2 that the State 
Treasurer intends to amend 



161 



NORTH CAROLINA REGISTER 



PROPOSED RULES 



regulation cited as 20 NCAC IG 
.0402. 

The proposed effective dale of this 
action is November 1 , 1987. 

The public hearing will be conducted 
at 10:00 a.m. on June 24, 1987, at 
Conference Room (Room 100), 
Department of Stale Treasurer, 325 
N. Salisbury Street, Raleigh, North 
Carolina. 

Comment Procedures: A written 
copy of the comments will be 



required of all persons wishing to 
speak at the public hearing. 

CHAPTER 1 - DEPARTMENTAL RULES 

SUBCHAPTER IG - INVESTMENT 
PROGRAM 

.0402 ELIGIBLE INVESTMENTS 

(c) The cash reserves of the 
investment fund may be temporarily 
invested in the Short-Term 
Investment Fund or in securities 
cliiiiblc 5or purchase under G.S. 
147-69. 1(c). 

Statutory Authority G.S. 147-69.3. 



NORTH CAROLINA REGISTER 



162 



LIST OF RULES AFFECTED 

NORTH CAROLINA ADMINISTRATIVE CODE 
LIST OF RULES AFFECTED 



EDITION XII, NO. 2 
AGENCY 
ADMINISTRATION 



EFFECTIVE: May I, 1987 
ACTIOS TAKES 



1 NCAC 


12 


.0601 
.0902 
.1005 
.1201 
.1402 
.1406 




Adopted 
Adopted 
Adopted 
Adopted 
Adopted 
Adopted 




35 


.0101 

.0103 

.0301 

.0303 

.0403-.0404 

.0407 




Amended 
Amended 
Amended 
Amended 
Amended 
Adopted 


CORRECTIONS 










5 NCAC 


2A 


.0202 




.Amended 




:b 


.0103 




Temp. Amended 
Expires 5-1-87 




21 


.2002 

.21)02 
.2003-.2006 

.2003-2006 




Temp. Amended 
Expires 5-1-87 
Amended 
Temp. Repealed 
Expires 5-1-87 
Repealed 




4C 


.1801-. 1806 
.1801-. 1806 




Temp. Repealed 
Expires 5-1-87 
Repealed 


GOVERNOR'S OFFICE 








9 NCAC 


2 


Executive 


Order Number 34 






Executive 


Order 


Number 35 






Executive 


Order 


Number 36 






Executive 


Order 


Number 37 






Executive 


Order 


Number 38 






Executive 


Order 


Number 39 






Executive Order Number 40 






Executive 


Order Number 41 






Executive Order 


Number 42 


HUMAN RESOURCES 










10 NCAC 


4C 


.0203-.0204 
.0402 




Amended 
Amended 




7A 


.0401 




Amended 




IDA 


.2001 
.2007-.2010 




Amended 
Amended 




10D 


.2401 
.2407 
.2409-2411 




Amended 
Amended 
Amended 




Ifll- 


.0001 
.0028-. 0032 




Amended 
Amended 



163 



NORTH C A ROUS A REGISTER 



LIST OF RULES AFFECTED 





.0034 


Amended 




.0041 


Amended 




10G.0703-.0707 


Amended 


INSURANCE 






1 1 NCAC 


15 .0001-.0010 


Amended 


LABOR 






13 NCAC 


7C.0101 


Amended 


CRIME CONTROL AND PUBLIC SAFETY 




14A NCAC 


8B .0101 


Amended 



NATURAL RESOURCES AND COMMUNITY DEVELOPMENT 

15 NCAC 2B .0304 Amended 

6E .0101-.0108 Adopted 

711.0208 Amended 

.0309 Amended 

7J .0312 Adopted 

1 OF. 03 14 Amended 



REVENUE 








17 NCAC 


9G.0 i 


Amended 






.0512 


Amended 




( >I 


.0202 


Amended 






.0502 


Amended 






.0504 


Amended 


TRANSPORTATION 








19A NCAC 


31 


.0101 


Amended 






.0104 


Amended 






.0201-.0202 


Amended 






.0204-.0205 


Amended 






.0206 


Repealed 






.0208 


Amended 






.0304 


Repealed 






.0306-. 0307 


Amended 






.0402-. 0403 


Amended 






.0501 -.0502 


Amended 






.0601 


Amended 






.0701-.0702 


Amended 






.0801 


Amended 






.0803 


Amended 






.0901-0909 


Repealed 




3.1 


.0101-.0102 


Adopted 






.0201 -.0208 


Adopted 






.0301 -.0308 


Adopted 






.0401-. 0403 


Adopted 






.0501 -.0508 


Adopted 






.0601-.0606 


Adopted 






.0701-. 0703 


Adopted 






.0801-.0803 


Adopted 


CPA EXAMINERS 








21 NCAC 


8A 


.0105 


Amended 




16M.0001-.0002 


Amended 




38 


.0104 


Amended 






.0201 


Amended 






.0202 


Repealed 






.0204 


Amended 



\ORTH CAROLLXA REGISTER 



164 



LIST OF RULES AFFECTED 



.0303 Amended 

58 A. 11 04 Amended 

COMMUNITY COLLEGES 

23 NCAC 2D .0301 Amended 

PERSONNEL 

25 NCAC ID. 0509 Amended 



165 SORT 1 1 CAROLINA REGISTER 



NC AC INDEX 



TITLE/MAJOR DIVISIONS OF THE NORTH CAROLINA 
ADMINISTRATIVE CODE 

TITLE DEPARTMENT 

1 Administration, Department of 

2 Agriculture, Department of 

3 Auditor, Department of State 

4 Commerce, Department of 

5 Corrections, Department of 

6 Council of State 

7 Cultural Resources, Department 

8 Elections, State Board of 

9 Governor 

10 Human Resources, Department of 

1 1 Insurance, Department of 

12 Justice, Department of 

13 labor, Department of 

14A ("rime Control, Department of 

1 5 Natural Resources and Community Development 

16 Education, Department of 

17 Revenue, Department of 

18 Secretary of State 

19A Transportation, Department of 

20 Treasurer, Department of State 

*21 Occupational Licensing Boards 

22 Administrative Procedures 

23 Community Colleges, Department of 

24 Independent Agencies 

25 Personnel, Department of State 

26 Office of Administrative Hearings 

NOTE: Title 21 contains the chapters of the various occupational 
licensing boards. 

CHAPTER LICENSING BOARD 

2 Architecture, Board of 

4 Auctioneers, Commission for 

6 Barber Lxamincrs, Board of 

8 Certified Public Accountant Lxamincrs 

10 Chiropractic Examiners, Board of 

12 Contractors, Licensing Board for 

14 Cosmetic Art Examiners, Board of 

16 Dental Lxamincrs, Board of 

18 Electrical Contractors, Board of Examiners 

20 Foresters, Board of Registration for 

21 Geologists, Board of 

22 Hearing Aid Dealers and Fitters Board 
26 Landscape Architects, Licensing Board of 

28 Landscape Contractors, Registration Board of 

30 law Examiners, Board of 

31 Martial & Family Therapy Certification Board 

32 Medical Lxamincrs, Board of 

33 Midwifery Joint Committee 

34 Mortuary Science, Board of 

36 Nursing, Board of 

37 Nursing Home Administrators, Board of 

38 Occupational Therapist, Board of 
40 Opticians, Board of 



NOR TH CA R OLINA REGIS TER 166 



NCACISDEX 



42 Optometry, Board of Examiners in 

44 Osteopathic Examination and Registration 

46 Pharmacy, Board of 

48 Physical Therapy, Examining Committee of 

50 Plumbing and Heating Contractors, Board of 

52 Podiatry Examiners, Board of 

53 Practicing Counselors, Board of 

54 Practicing Psychologists, Board of 

56 Professional Engineers and land Surveyors 

58 Real Estate Commission 

60 Refrigeration Examiners, Board of 

62 Sanitarian Examiners, Board of 

64 Speech and Eanguage Pathologists and 

Audiologists, Board of Examiners of 

66 Veterinary Medical Board 



167 NORTH CAROLINA REGISTER 



CUMULA T1VE INDEX 



CUMULATIVE INDEX 

(April 1987 - March 1988) 



1987 - 1988 

Pages Issue 

1-137 April 

138-169 May 



AO - Administrative Order 

AG - Attorney General's Opinions 

C - Correction 

E - Errata 

EO - Executive Order 

FDL - Final Decision Letters 

FR - Final Rule 

GS - General Statute 

JO - Judicial Order 

LRA - List of Rules Affected 

M - Miscellaneous 

NP - Notice of Petitions 

PR - Proposed Rule 

SO - Statements of Organization 

TR - Temporary Rule 

ADMINISTRATION 

State Employees Combined Campaign, 13 PR 

AGRICULTURE 

Pesticide Board, 13 PR 

COMMERCE 

Departmental Rules, 14 PR, 143 PR 
Savings & Loan Division, 147 PR 

CORRECTION 

Division of Prisons, 105 FR 
Parole Commission, 106 FR 

CRIME CONTROL AND PUBLIC SAFETY 

State Highway Patrol, 159 PR 

EXECUTIVE ORDERS 

Executive Orders 34 - 42, 1 EO 
43 - 46, 138 EO 

FINAL DECISION LE1TERS 

Voting Rights Act, 10 FDL, 141 FDL 

HUMAN RESOURCES 

AFDC, 156 PR 

Family Services, 152 PR 



NORTH CAROLINA REGISTER 168 



CUMLLA LIVE INDEX 



Individual and Eamilv Support. 153 I'R 
Medical Services, 149 PR 
Mental Health Retardation 
and Substance Abuse, 15 PR 

INSURANCE 

Life Accident & Health Division, 17 PR 

JUSTICE 

Education and Training Stand;irds, 19 PR 

LICENSING BOARD 

Medical Examiners, 95 PR 

LIST OF RULLS AFFECTED 

Volume 12, No. 1 
(Apnl 1, 1987), 131 LRA 
Volume 12, No. 2 
(May 1, 1987). 163 LRA 

NATURAL RESOURCES AND COMMUNITY DEVELOPMENT 

Coastal Management, 94 PR. 160 PR 
Economic Opportunity, 161 PR 
Environmental Management, 29 PR 
Marine Eishcrics, [-4 PR 

REVENUE 

Individual Income lax, 107 I'R 
Motor Euels lax, 108 ER 

STATE PERSONNEL 

State Personnel Commission, 96 PR 

STATE TREASURER 

Departmental Rules, 161 PR 

TRANSPORTATION 

Motor Vehicles, 109 ER 



169 NORTH CAROLINA REGISTER 



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999 II J3AUJJCI O d 

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